If you’re part of the pNetwork community, then you know that the project’s Total Value Locked (TVL) has been growing steadily for over a year. As a matter of fact, on May 10, 2021, we’ve reached a significant milestone that’s propelled us to work even harder on expanding our reach in the DeFi space — over $100 million in TVL!
Despite the fluctuations in the market, we have continued to grow since then. Currently, the biggest/most active pNetwork-powered bridge is pBTC on ETH that counts 1,435+ BTC!
So, what makes for a sturdy TVL of any blockchain project? What information can we deduce from this indicator and the way it behaves in the wake of frequent market oscillations? And finally, what can you learn from pNetwork’s TVL?
Let’s find out!
What Is Total Value Locked?
TVL has become the most commonly used metric in the blockchain industry, utilized for measuring and comparing the growth of Ethereum-based DeFi projects in particular. It refers to the number of assets staked in a specific project or the total amount of underlying supply secured by a project, application, or protocol operating in the DeFi sphere.
To DeFi participants looking for projects to support and invest in, this is the metric that shows the overall health of projects individually and in comparison to one another.
As of July 13th, 2021, the total value locked in all DeFi projects has been $53.81 billion, with the industry being worth $88 billion at its peak.
And as much as the factors according to which this number has been calculated are confusing to many crypto and DeFi enthusiasts, there are three clear stand-out measurements:
- Circulating supply of the project’s tokens
- Maximum supply of tokens
- Current token price.
When surveying a project through these components, it becomes clear why TVL has been used as the de facto metric to show the growth of decentralized finance and a helpful guide to DeFi participants on the hunt for new opportunities.
However, each DeFi project is different in its own way, and therefore, has individual value to offer to the space and be measured against.
pNetwork’s Total Value Locked
Even though TVL is the benchmark for DeFi projects, a more relevant metric showcasing the pNetwork project’s magnitude is the volume of cross-chain transactions.
As a project focused on transcending the limitations of individual blockchain platforms via cross-chain composability, pNetwork needs to be viewed through this prism for the spectator to be able to get an accurate representation of the project’s growth journey, long-term sustainability, and massive potential.
Obviously, total value locked is not enough.
pNetwork’s value lies in far more than just the cumulative amount of tokens locked.
Here is what makes the project worthy and makes TVL growth sustainable.
Numerous (New) Cross-Chain Bridges
A progressively decentralized platform, pNetwork powers pTokens — an ever-growing number of cross-chain bridge infrastructure — through which it connects several major blockchains. As of July 2021, those include Ethereum, Binance Smart Chain, Bitcoin, EOS, Telos, Polygon, xDai, and more, with Algorand and several others coming soon.
Therefore, its total value locked (TVL) is heavily influenced by the rate at which the project is able to complete its core goal — to connect as many assets and blockchains — and by extension, open new yield farming opportunities for users, and spur the growth of the DeFi ecosystem as a whole.
For now, the largest share in the pNetwork TVL is coming from pTokenized assets on:
- Ethereum ($51.5M)
- BSC ($15.8M)
- EOS ($5.96M), respectively.
Naturally, connecting chains will continue to have a positive effect on pNetwork’s total value locked in the future. However, this is not the end of the road for the project — this is where the journey starts.
Yield Farming Opportunities Across Chains
With more blockchains being linked via pNetwork-powered bridges, their native infrastructure and use cases will become available to “non-native” users holding tokens from a wide variety of chains, without the need to exchange them to access their benefits.
This means that BTC holders can seamlessly move their liquidity from Bitcoin to Ethereum, for example, via a corresponding pNetwork-powered bridge, and never lose their coins’ value — as pTokens are always pegged in a 1:1 ratio with their underlying assets.
Now pBTC holders (who are boosting pNetwork’s total value locked via the adoption of this pTokenized asset on a host blockchain) can access new, previously unavailable, DeFi opportunities — most notably, liquidity mining pools on various connected chains.
One of the many DeFi incentives where pNetwork users can maximize their yields through pTokens — and particularly interesting for pBTC holders, for example — is the Curve pBTC/ETH liquidity mining pool available on steroids.finance and Curve.fi directly.
Furthermore, and this particular example notwithstanding, it is clear that the wider the integration net is cast, the larger the pool of active and passive income opportunities in the DeFi sector for the users, which in turn makes pNetwork’s total value locked withstand fluctuations and steadily increase.
Collaborations With DeFi Platforms
In April 2021, pNetwork partnered with Algorand to build novel cross-chain connections with this blockchain and those already connected by pNetwork.
This decentralized platform builds technology that accelerates the convergence between decentralized and traditional finance by enabling the simple creation of the next generation of DeFi products. Moreover, according to CoinMarketCap, Algorand is considered one of the top 50 DeFi projects.
Considering these points, this alliance not only opens new doors to users but also gives more visibility and credibility to pNetwork, automatically enhancing the project’s total value locked in crypto and cross-chain transactions processed inside the dApp.
As you can see, pNetwork’s TVL sustainable growth is based on solid fundamentals that show that the project’s value is recognized by more people every day.
Join now and be part of the new cross-chain transactions era.
🔋 Learn more about the pNetwork, the decentralized system, and DAO powering pTokens.
🔗 For any blockchain project looking to integrate pTokens into their infrastructure, we have also built a pTokens JS library.
💌 Excited about pBTC & pLTC? Sign up for our newsletter and be the first to know which blockchain pTokens will make their home in next.